A recent report on Asian imbalances by Morgan Stanley shows that throughout the boom-and-bust periods since the early 1980s, investment has consistently fallen short of savings (see chart 2). Households, which used to be Japan’s greatest hoarders, put less aside in the years before the financial crisis as a combination of low wage-growth and an ageing population took its toll: the household-saving rate fell from above 10% in the 1990s to about 2.2% in 2007. But the country continued to spend less than it earned because exporters squirrelled a chunk of their profits away. (The Economist)

More of the SameBy Rev SharkRealMoney.com Contributor8/28/2009 8:34 AM EDT

A trend is a trend is a trend. But the question is, will it bend? Will it alter its course Through some unforeseen force And come to a premature end? -- Alec Cairncross

It's easy for market players to overthink the market action. That is especially the case now as we experience the most chaotic economic situations any of us have ever seen. It is almost impossible to not be influenced by the fundamental news and our personal experiences with a struggling economy.

This market continues to reward those who don't think too much but rather simply respect the power of the uptrend. Contemplating whether the market action has been justified has not been a moneymaker. The fact that so many people are struggling to embrace the market is a big reason it keeps running. There is a constant hunt to put money to work even among the skeptics, and that keeps producing action like yesterday, when market action looked weak at first but ended up gaining steam all day.

One reason we are seeing so many bearish comments about the market lately is that this action is almost monotonous in its consistency. Active market players tend to thrive on volatility and change, and this market is primarily a dream for the buy-and-holders who do nothing but sit and watch as things trend higher and higher.

My advice remains the same: Respect the price action and don't try to be overly anticipatory in looking for the market to collapse. There is little in the technical action that is negative other than the fact that we have trended much higher than most folks thought possible. Sure, there are plenty of fundamental arguments against this market -- there are always fundamental arguments against the market -- but they don't matter until they do. That is why we have to stay focused on the price action and not work too hard to convince ourselves that the fundamental arguments are suddenly going to cause everyone to head for the exits.

I'd love to offer some new and brilliant insight into the market, but the most scintillating observation I can make is that little has changed. The trend is still up, the bulls are in control and there are plenty of bearish arguments that just don't matter yet. Govern yourself accordingly. -----------------------------Ülespoole avanevad:

J.P. Morgan Chase, an amalgam of some of Wall Street's most storied institutions, now holds more than $1 of every $10 on deposit in this country. So does Bank of America scarred by its acquisition of Merrill Lynch and partly government-owned as a result of the crisis, as does Wells Fargo, the biggest West Coast bank. Those three banks, plus government-rescued and -owned Citigroup, now issue one of every two mortgages and about two of every three credit cards, federal data show (loe pikemalt siit).